On my phone the Android System app is zero in size. Is this normal or have I been hacked?
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Android System App is only there to represent the Android Framework. If your device is working, you don't have a reason to worry about that.
If that "App" was really of zero size your phone would not even work up until the point that you could actually see its size (= Android would not boot)
Whether you have been hacked is quite a different story, we can't determine that just out of knowing that it shows zero size for you on Android System.